Bank Sarasin, the Swiss private bank, is set to acquire a majority stake in the Zurich-basd Neue Zuercher Bank, in order to boost client confidence following a probe by the Swiss regulator. NZB will withdraw from private banking as part of the deal.

Sarasin previously held a 40% holding in NZB, which it will raise to 51%-60%, according to a press release.

"The purpose of the acquisition is to boost the confidence of staff and clients in NZB," said Sarasin in a statement.

It said: "The planned acquisition was in response to personnel changes in NZB and the latest decisions by the Swiss regulator FINMA in connection with the investigations in the Sulzer affair."

NZB said its co-founder and chief executive officer Martin Eberhard will step down afer a Swiss regulatory probe into the bank's role in transactions involving shares of Swiss technology company Sulzer.

NZB was again in the spotlight in August, when another one of its senior bankers left the after it learned of his indictment in Florida, for allegedly advising wealthy Americans to hide assets from tax authorities in Switzerland.

Sarasin said it will focus NZB's business activity on its brokerage operations while it will close its private banking business.

Swiss financial watchdog FINMA called for the personnel changes at NZB following an investigation into how NZB, Swiss bank Zürcher Kantonalbank and German lender Deutsche Bank helped investors build up a 31% holding in Switzerland's Sulzer in 2007.